‘Gov’t retirees not at fault for pension overpayments’

Senate President Edith E. DeLeon Guerrero (D-Saipan) believes that it is unfair, unreasonable, and unconscionable for the government retirees, who are not at fault, to be required to pay back the overpayments of benefits.

DeLeon Guerrero said retirees can’t afford to pay back the overpayments, which range from several thousand dollars to hundreds of thousands of dollars.

In line with this, the president recently filed a resolution requesting the NMI Settlement Fund to waive recovery of overpayments of benefits from retirees based on fairness, equity, and good conscience.

She stated in Senate Resolution No. 23-16 that the Settlement Fund should waive the recovery of all overpayment of benefits from all affected retirees and dismiss all administrative and court cases where the Settlement Fund is seeking recovery of overpayment of benefits.

DeLeon Guerrero said the retirees are terrified of being sued in court to recover the overpayments.

She said the retirees cannot afford to pay back the overpayments let alone afford to pay for lawyers to defend them against recovery of such overpayments that were miscalculated through no fault of the retirees.

In March 2015, the Settlement Fund, utilizing a benefits audit software, identified 399 overpayments and underpayment member (retiree) files.

DeLeon Guerrero said after the manual five-step review process was completed, member files with no issues were closed out.

There were 247 files that did not have issues and 152 files that had issues. Members whose files had issues were given a formal notice, and an opportunity to respond or settle.

Pursuant to the Settlement Fund’s Trustee’s report dated Sept. 27, 2017, out of the 152 retiree files that had issues, 131 files involved overpayment of benefits and 21 files involved underpayment of benefits.

Since March 2015, the Settlement Fund has attempted to resolve the 152 files with issues.

DeLeon Guerrero said as of September 2023, there are 133 retiree files with issues involving overpayments and 16 retiree files with issues involving underpayments pursuant to the Trustee’s report dated Oct. 24, 2023.

She said subsequently, over 200 retirees received letters from the Settlement Fund, informing them of an “adjustment” to their pension “to reflect the correct amount” after it was determined that the overtime work they performed during their active employment may not be used to calculate their benefits.

The president noted that it was reported that the Settlement Fund administrator Lilian M. Pangelinan informed the affected retirees that beginning with the pay period ending Nov. 15, 2023, “the Settlement Fund will adjust your benefits to reflect the correct amount…”

She said Pangelinan cited the adverse decision letter that the former NMI Retirement Fund issued on May 7, 2012, notifying each retiree of the overpayment of benefit they had received over the years.

For those who did not appeal the decision, Pangelinan said, “the findings in the letter are final and binding.”

DeLeon Guerrero said in addition to adjusting benefits more or less pursuant to the benefits audit of retiree files, the Settlement Fund has been engaged in numerous administrative appeals and court litigation trying to recover the overpayments from retirees, their beneficiaries and the probate estates of retirees for several years.

She said some of these retirement files involve overpayments that have exceeded the six-year statute of limitations for filing a claim to recover overpayments.

DeLeon Guerrero said most, if not all, of the Settlement Fund’s claims of overpayment of benefits involve miscalculations or erroneously adding service credits or overtime to an individuals’ retirement benefits that is not authorized by law, and through no fault of the retirees.

She said the miscalculations were made by the Settlement Fund’s predecessor, the NMI Retirement Fund and its employees.

The president said Settlement Fund’s determination to recover overpayments of benefits has shaken the lives of retirees who are subject to the recovery.

She said retirees are being bombarded with letters and notices about overpayments from the Settlement Fund.

Edith DeLeon Guerrero